For Sale By Owner Homes / Mortgage Blog

Buying into FSBO movement
No-commission sale appeals to Arizonans

Susie Steckner
Special for The Republic
Jun. 2, 2007 12:00 AM

In any given month, Mesa businessman Jamison Manwaring is juggling 100 or so clients who are selling very different homes with one goal: making a sale without using a real estate agent.

Instead of paying commission, they hand over a few hundred dollars to his For Sale By Owner affiliate for some professional guidance, an Internet listing and a yard sign. Last year, about 250 homeowners decided to go it alone with the company's help.

They're not the only ones striking out on their own. advertisement




In the past decade, homeowners across the country have joined the FSBO - for sale by owner - movement. Lured by the idea of cutting out commissions, they are largely relying on the Internet, plus tried-and-true For Sale signs and word-of-mouth advertising, to market and sell their homes.

The FSBO phenomenon has spawned numerous Web sites to connect buyers and sellers, such as Manwaring's www.byowneraz.com, how-to books, and guides such as Selling Your Home Without an Agent, an online tip sheet from the popular Dummies series of reference books.

The prospect of selling a home without a typical 6 percent commission is especially appealing in Arizona and elsewhere where the housing market has cooled.

"In markets like this, you tend to see more for sale by owners. They're cutting the sales price as close as they can, so they want to cut out the commission," said Jay Butler, director of realty studies at Arizona State University's Polytechnic campus in Mesa.

If selling a home on your own seems a daunting task, it can be. The thought of pricing a home, getting the property ready for sale, picking out the serious buyers, negotiating a deal and completing the paperwork are enough to send some homeowners into the arms of a real estate agent, commission and all.

Butler said that a good, experienced agent can be well worth the commission.

Just screening potential buyers is a major challenge, Butler said. "This is the best thing a good agent brings to the game. Is this a meaningful buyer or a looky-see?"

Handling the paperwork - from inspection and disclosure forms to a purchase contract - is another hurdle.

Richard Keyt, a business, real estate and estate-planning lawyer with Keyt Law LLC in Phoenix, offers a range of document preparation services for people who sell their own homes. He charges a flat fee depending on a client's needs and also notes that sellers can buy documents themselves through the Arizona Association of Realtors.

Keyt said it is crucial that sellers have documents, such as purchase contracts, that are relevant to Arizona and not something found online and adapted for a sale locally.

"It could have some fatal flaws in it," he said.

FSBO experts say successful sellers must do their homework, commit to the time-consuming home-sale process and hire reliable professionals. And they have to learn to do without the hand-holding that agents traditionally offer through, say, a bad inspection or tense negotiation.

Among the things FSBO hopefuls should consider:


• Interview several real estate agents. This could bolster your decision to do the work yourself or convince you to go with an agent, and also may provide information and tips that can help with your sale, according to dummies.com.


• Put the right price on the home. Check what comparable homes have sold for in your area. Homes sales often are published in newspapers, and some real estate Web sites, such as www.for salebyowner.com, can help sellers find comparables for a fee.


• Market the home. Use a combination of methods to advertise and sell, including the Internet, classified newspaper ads, yard signs and flier boxes. Some FSBO companies offer listings on their Web sites and, for an additional fee, a listing on the traditional Multiple Listing Service used by real estate agents.


• Be available. Once your home goes on the market, be ready to take phone calls, show the home when potential buyers want to see it and hold open houses, if necessary. Though there may be inconveniences to this, sellers also can take advantage of personally showing off upgrades and other special features of the home.


• Stay in the game. Don't take the home off the market with an offer alone. Make sure that a buyer will qualify for a mortgage, and beware of buyers who want to make your sale contingent on the sale of their own home, according to Dummies.com.


• Hire professionals. Use a title company, real estate lawyer and other professionals to help with the necessary paperwork.


• Get some help. Consider using companies such as Help U Sell or Manwaring's For Sale By Owner affiliate, which charge a fee to provide some services, such as preparing documents.